The BBC expects to co-produce “much less” with global SVOD services such as Netflix and Amazon in the future and is increasingly looking to partner with international free-to-air broadcasters.

BBC Director General Tony Hall, speaking in the House of Lords Communications Committee, added that multi-million-dollar deals for top talent also poses a big challenge for the British public broadcaster.

During the session, he said that over the next few years, he expects Netflix and Amazon to increasingly commission their own projects out of the UK rather than co-produce high-end scripted titles with UK networks.

“Because this country has extraordinary creative talent, in drama and natural history, [Netflix and Amazon] have been doing co-productions with people like us. The big question is over the next three or four years, will they continue to do that or will they have so much muscle that they’ll say they don’t need the BBC, ITV, Channel 4, we can fund these things ourselves. A bit of me thinks that’s likely,” he said.

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“My own guess is that in the future we will do much less with the Netflixes and Amazons. That’s a challenge that we have. We want to work with them but with our eyes open. I think we’ve had an injection of money into the broadcast system from SVODs, which has enabled us to do some extraordinary things… but I think we’re going to to have to get used to something that’s got to come off and will be much less in the future. For the future, we’ve probably got to think beyond that and find the right people to make programmes with, who are part of the free to air community,” he added.

The BBC is still producing a number of titles with both companies including Neil Gaiman’s Good Omens, which is produced by BBC Studios and launched last month on Amazon before its BBC TX later this year, and Netflix co-pro Dracula.

He said that in the future, he would like to fully fund more projects, although there is a funding challenge. He said to keep the UK’s “extraordinary creative ecology”, it needs more money. “Bluntly, that is money. It makes the world go ‘round. I would really hope for us to have a proper debate about the quantum of the licence fee and the funding of the rest of the PSB ecology. I would hope that we don’t have another licence fee settlement behind closed doors,” he said.